Full Press Release Details
SECURITIES PURCHASE AGREEMENT
This SECURITIES PURCHASE AGREEMENT (this Agreement ) is made and entered into as of February 13, 2018 (the
Effective Date ) by and among Merus N.V., a public company with limited liability (naamloze vennootschap) incorporated under the laws of the Netherlands (the Company ), and the Investors identified on
Exhibit A attached hereto (each an Investor and collectively the Investors ).
A. The Company and each Investor is executing and delivering this Agreement in reliance upon the exemption from securities
registration afforded by Section 4(a)(2) of the Securities Act of 1933, as amended (the 1933 Act ), and/or Rule 506 of Regulation D ( Regulation D ) as promulgated by the United States Securities and Exchange
Commission (the SEC ) under the 1933 Act; and
B. The Investors wish to purchase from the Company, and the Company
wishes to sell and issue to the Investors, upon the terms and subject to the conditions stated in this Agreement, Common Shares (the Shares ) of the Company, nominal value 0.09 per share (the Common
C. Contemporaneously with the sale of the Shares, the parties hereto will execute and deliver a Registration Rights
Agreement, in the form attached hereto as Exhibit B (the Registration Rights Agreement ), pursuant to which the Company will agree to provide certain registration rights in respect of the Shares under the 1933 Act, and
the rules and regulations promulgated thereunder, and applicable state securities laws.
In consideration of the mutual promises made
herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1. Definitions. For the purposes of this Agreement, the following terms shall have the meanings set forth below:
Affiliate means, with respect to any Person, any other Person which directly or indirectly through one or more
intermediaries Controls, is controlled by, or is under common Control with, such Person.
Business Day means a day,
other than a Saturday or Sunday, on which banks in New York City are open for the general transaction of business.
Closing has the meaning set forth in Section 3.1.
Closing Date has the meaning set forth in Section 3.1.
Control (including the terms controlling , controlled by or under common control with )
means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.
Deed of Issue has the meaning set forth in Section 2.
Disclosure Schedules has the meaning set forth in Section 4.
Environmental Laws has the meaning set forth in Section 4.16.
FCPA means the Foreign Corrupt Practices Act of 1977, as amended.
FDA has the meaning set forth in Section 4.27.
IFRS has the meaning set forth in Section 4.18.
Intellectual Property means all patents, patent applications, trademarks, trademark applications, service marks, trade
names, copyrights, trade secrets, licenses, domain names, information and proprietary rights and processes.
Questionnaire has the meaning set forth in Section 3.1.
Material Adverse Effect means a material
adverse effect on (i) the assets, liabilities, results of operations, financial condition or business of the Company and its Subsidiaries taken as a whole, (ii) the legality or enforceability of any of the Transaction Documents or
(iii) the ability of the Company to perform its obligations under the Transaction Documents; provided, however, that in no event shall any of the following occurring after the date hereof, alone or in combination, be deemed to
constitute, or be taken into account in determining whether a Material Adverse Effect has occurred: (i) any change in the Company s share price or trading volume, or (ii) any effect caused by the announcement or pendency of the
transactions contemplated by the Transaction Documents, or the identity of any Investor or any of its Affiliates as the purchaser in connection with the transactions contemplated by the Transaction Documents.
Material Contract means any contract, instrument or other agreement to which the Company is a party or by which it is bound
which is material to the business of the Company, including those that have been filed as an exhibit to the SEC Filings pursuant to Item 19, Instruction 4 of Form 20-F.
Nasdaq means The Nasdaq Global Market.
Person means an individual, corporation, partnership, limited liability company, trust, business trust, association, joint
stock company, joint venture, sole proprietorship, unincorporated organization, governmental authority or any other form of entity not specifically listed herein.
Press Release has the meaning set forth in Section 7.6.
Registration Rights Agreement has the meaning set forth in the Recitals.
Required Investors has the meaning set forth in the Registration Rights
SEC Filings has the meaning set forth in Section 4.
Selling Shareholder Questionnaire has the meaning set forth in Section 3.1.
Shares has the meaning set forth in the Recitals.
Short Sales means all short sales as defined in Rule 200 of Regulation SHO under the 1934 Act (but shall not be
deemed to include the location and/or reservation of borrowable Common Shares).
Subscription Amount means, as to an
Investor, the aggregate amount to be paid for the Shares purchased hereunder as specified opposite such Investor s name on Exhibit A attached hereto, under the column entitled Aggregate Purchase Price of Shares, in U.S.
Dollars and in immediately available funds.
Subsidiaries has the meaning set forth in Section 4.1.
Trading Day means a day on which Nasdaq is open for trading.
Transaction Documents means this Agreement, the Registration Rights Agreement, and the Deed of Issue.
Transfer Agent has the meaning set forth in Section 7.5.
1933 Act has the meaning set forth in the Recitals.
1934 Act means the Securities Exchange Act of 1934, as amended, or any successor statute, and the rules and regulations
promulgated thereunder.
2. Purchase and Sale of the Shares. On the Closing Date, upon the terms and subject to the conditions set
forth herein, the Company will issue and sell, and the Investors will purchase, severally and not jointly, the number of Shares set forth opposite the name of such Investor under the heading Number of Shares to be Purchased on Exhibit
A attached hereto at a price per Share equal to $18.00, pursuant to the execution by the Company of a deed of issue of the Shares under Dutch law in the form attached hereto as Exhibit C (the Deed of Issue ). As a matter
of Dutch law, references in this Agreement to Shares being sold and purchased (and the corollary usages of those terms) should be understood to mean that Shares are being issued and subscribed for, respectively.
closing of the purchase and sale of the Shares (which Shares are set forth in the Schedule of Investors) pursuant to this Agreement (the Closing ) shall be held at 10:00 A.M. (Pacific Time) on the second Trading Day following the
Effective Date at the offices of Latham & Watkins LLP, 200 Clarendon Street, Boston, Massachusetts 02116, or at such other time and place as may be agreed to by the Company and the Investors (the Closing Date ). At
or prior to the Closing, each Investor shall execute any related agreements or other documents required to be executed hereunder, dated on or before the Closing Date, including but not limited to
the Investor Questionnaire and the Selling Shareholder Notice and Questionnaire in the forms attached hereto as Appendix I and Appendix II (the Investor Questionnaire and the Selling Shareholder
Questionnaire, respectively).
3.2. On the Closing Date, prior to the execution by the Company of the Deed of Issue, each
Investor shall deliver or cause to be delivered to the Company the Subscription Amount via wire transfer of immediately available funds pursuant to the wire instructions delivered to such Investor by the Company on or prior to the Closing Date. The
Company consents to payment of each Subscription Amount in United States dollars.
3.3. At the Closing, subject to receipt by the Company
of the Subscription Amount from each Investor as contemplated by Section 3.2, the Company shall issue and deliver or cause to be issued and delivered to each Investor a number of Shares, registered in the name of the Investor, in the amount set
forth opposite the name of such Investor under the heading Number of Shares to be Purchased on Exhibit A attached hereto pursuant to the Deed of Issue. Upon the execution of the Deed of Issue, the Company shall cause the Shares to
be recorded in the register of the Transfer Agent in book entry form.
4. Representations and Warranties of the Company. The
Company hereby represents and warrants to the Investors that, except as set forth in the schedules delivered herewith (collectively, the Disclosure Schedules ), if any, and except as otherwise described in the Company s
filings pursuant to the 1934 Act (collectively, the SEC Filings ), which qualify these representations and warranties in their entirety, as of the date hereof:
4.1. Organization, Good Standing and Qualification. The Company is an entity duly incorporated and validly existing as a public company
with limited liability (naamloze vennootschap) under the laws of the Netherlands, with the requisite corporate power and authority to own or lease and use its properties and assets, to execute and deliver the Transaction Documents, to carry
out the provisions of the Transaction Documents, to issue and sell the Shares and to carry on its business as presently conducted as described in the SEC Filings. Each of the Company s Subsidiaries required to be disclosed pursuant to
Item 19, Instruction 8 in an exhibit to its annual report on Form 20-F filed with the SEC for the year ended December 31, 2016 and any Subsidiaries that will be required to be disclosed for the year ended December 31, 2017 (the
Subsidiaries ) is an entity duly incorporated or otherwise organized, validly existing and in good standing (to the extent such concept exists in the relevant jurisdiction) under the laws of the jurisdiction of its incorporation or
organization, as applicable, and has all requisite power and authority to carry on its business to own and use its properties. Neither the Company nor any of its Subsidiaries is in violation or default in any material respect of any of the
provisions of its respective articles of association, charter, certificate of incorporation, bylaws, limited partnership agreement or other organizational or constitutive documents. Each of the Company and its Subsidiaries is duly qualified to do
business as a foreign entity and is in good standing (to the extent such concept exists in the relevant jurisdiction) in each jurisdiction in which the conduct of its business or its ownership or leasing of property makes such qualification
necessary, except to the extent any failure to so qualify has not had and would not reasonably be expected to have a Material Adverse Effect.
4.2. Authorization. The Company has the requisite corporate power and authority and has
taken all requisite corporate action necessary for, and no further action on the part of the Company, its officers, directors and shareholders is necessary for, (i) the authorization, execution and delivery of the Transaction Documents,
(ii) the authorization of the performance of all obligations of the Company hereunder or thereunder, and (iii) the issuance and delivery of the Shares. Each of the Transaction Documents, upon execution and delivery by the Company, assuming
due authorization, execution and delivery by the Investors, constitute valid and binding obligations of the Company enforceable in accordance with their terms, except (a) as limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other laws of general application affecting enforcement of creditors rights, (b) general principles of equity that restrict the availability of equitable remedies and (c) to the extent that the enforceability of
indemnification provisions may be limited by applicable laws.
4.3. Capitalization. The Company has not issued any capital stock
since its most recent SEC Filing, other than pursuant to the exercise of employee share options under the Company s share options plans. All of the issued and outstanding securities of the Company have been duly authorized and validly issued
and are fully paid, and none of such securities were issued in violation of any pre-emptive rights and such securities were issued in compliance in all material respects with applicable Dutch laws and U.S. state and federal securities law and any
rights of third parties. Except as stipulated in the Articles of Association of the Company dated May 29, 2017, no Person is entitled to pre-emptive or similar statutory or contractual rights with respect to the issuance by the Company of any
securities of the Company. Except for share options outstanding issued pursuant to the Company s share options plans, there are no outstanding warrants, options, convertible securities or other rights, agreements or arrangements of any
character under which the Company is or may be obligated to issue any equity securities of any kind and except as contemplated by this Agreement. Except for the Registration Rights Agreement, there are no voting agreements, buy-sell agreements,